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As Tom addressed most of your queries, I would like to say something regarding your following enquiry:"Also please elaborate best practices(Such as IP address, Physical address, look and feel etc.) if someone wants to run same business through more than one website?"

Here, your intent and goals matter. For example, a business entity intends to occupy multiple places in the SERPs using multiple websites for the same search terms. I would never recommend this practice to anyone. If you are targeting a set of keywords or phrases, do that using one single domain and put all your SEO efforts towards building it and try to make it an authority in the niche. This should be the long term goal.

In the past, I have had clients who had an SEO strategy like the following:

1. One target keyword.2. Multiple websites targeting the same keyword.3. Occupy multiple places in the top 10 Google search results.

This strategy is very hard to fly these days in Google. This strategy used to be lucrative for some seasonal sale kind of businesses, who did not care about their websites once the season ended or their stock cleared, it is not at all recommended if you are here for a long-haul.

Personally, I have seen such strategies working for quite a while and then either all of them or most of those websites (pack of websites from the same business entity) being thrown out of index or penalized. Please note that some of the clients used all the tactics under the Sun to erase the traces of association among these websites and tried to make them look as if they were being operated by different business entities.

Few such traces include but not limited to:a. same IPb. same whois infoc. same website templatesd. design and flow similaritiese. same analytics tracking infof. logging or accessing these websites from same geo-location, systemsg. browsing history and access patterns.

h. no cross linking etc..

Though using methods like the above can buy you sometime before the axe comes down, we should refrain ourselves from all the unethical ways or loopholes to trick search engines and their algorithms. It is one of the daily tasks of a good SEO professioinal to set the right SEO perspective to his clients. He should learn to say, 'No' to any such proposals made by the client to trick the search engines.

It's not unreasonable at all that a company may operate from the same premises, both physically and digitally.

In terms of SEO, having 2 sites interlinking with each other that sit on the same IP won't be a problem. In fact, a few more wouldn't be a problem either. Matt Cutts recently answered the question on how (and how much) you should link your sites together: http://youtu.be/x0-jw_PfwtY

In short, you can do so happily in moderation - so 2 websites like yours linking together won't be a problem at all. I'd say you'd need to look at things a bit closer if you have 5 or more.

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